President Irfaan Ali has reaffirmed that his administration will not seek to alter the terms of the 2016 Production Sharing Agreement governing the Stabroek Block, telling an audience at Rice University’s Baker Institute in Houston, Texas, that the sanctity of contract remains a cornerstone of his government’s position on the oil deal.

The Stabroek Block Production Sharing Agreement, signed between Guyana and ExxonMobil along with its partners Hess Corporation and CNOOC, has faced sustained criticism since its signing due to terms widely regarded as heavily favouring the oil companies. The agreement waives all taxes on the oil companies, stipulating that Guyana must cover those costs. It allows the consortium to recover up to 75 percent of their investments before the remaining 25 percent is divided, with Guyana receiving 12.5 percent of that split in addition to a 2 percent royalty.

Addressing the Baker Institute audience, President Ali acknowledged that many have raised questions about the deal. He stated that his government has been clear that the sanctity of contract is important and that instead of revisiting the existing agreement, his administration has developed a new Production Sharing Agreement framework to govern all future offshore oil blocks. Ali framed this approach as a demonstration of policy predictability, which he described as a critical factor for attracting investment in the energy sector.

The president’s current position represents a significant shift from statements he made prior to taking office. During the March 2020 election campaign, Ali was sharply critical of the ExxonMobil deal signed by the then APNU+AFC Coalition government, indicating that his party would review and renegotiate contracts to ensure Guyana did not receive unfavourable terms. Since assuming office in August 2020, however, his administration has consistently cited sanctity of contract as the reason it will not pursue changes to the existing agreement.

In a 2023 BBC interview, Ali acknowledged that Guyana did not secure the best deal and that ExxonMobil had benefited from favourable terms agreed to by the previous government, while reiterating that his administration could not walk back from the contract.

Notably, it was the former Coalition government that originally signed the deal in 2016, but also the same administration that subsequently renegotiated a key fiscal element of it. In April 2019, former President David Granger and the Exxon consortium signed Addendum No. 1 to the Petroleum Agreement, which closed a loophole that had allowed the 2 percent royalty to be recovered by the oil companies. The addendum explicitly stated that the royalty could not be recovered in any manner, representing a material improvement to Guyana’s fiscal position under the deal.

The man who signed the original 2016 agreement, former Minister of Natural Resources Raphael Trotman, has since expressed support for renegotiation. In his book, Trotman offered assistance to the current administration in reviewing the terms of the Stabroek Block deal. That offer was declined by Vice President Bharrat Jagdeo.

The PPP administration’s firm stance has drawn praise from at least one Stabroek Block partner. Ahead of the 2025 general elections, Hess Corporation Chief Executive John Hess publicly cited President Ali’s assurances of no contract changes as evidence of political and fiscal stability in Guyana, a signal the company used to reassure its own stakeholders about the security of its 30 percent interest in the block.

As Guyana’s oil production approaches one million barrels per day and revenues continue to climb, the debate over whether the country is receiving its fair share from the Stabroek Block remains one of the most consequential and unresolved questions in national public life.

SOURCE: Kaieteur News, “Govt. not budging on changes to Exxon’s contract,” May 7, 2026